5 Reasons Good Strategy Can Go Bad
by Jeff Scott, on Jun 30, 2014 8:00:00 AM
Last week I presented a webinar entitled “Why Good Strategies Go Bad – And What You Can Do About It”, these slides are embedded at the end of this blog.
In the webinar I brought up the five, major reasons good strategy goes bad:
- Poor strategy articulation
- Strategy diffusion
- Strategy that disregards culture
- Lack of strategy management process
From the webinar discussion, I want to expand a bit further on each of the five reasons good strategy goes bad..
1. Poor Strategy Articulation
Executives generally know what needs to be done, they are just not that good at articulating it, and for the most part neither is anyone else.
When you look at most organizations’ strategic plans you will find a lot of goals, objectives, aspirations, needs, and even a few projects all masquerading as strategy.
What you won’t find a lot of is actual strategies.
2. Strategy Diffusion
As strategic intent is relayed across and down the organization, it loses its original fidelity. At each organizational level, mangers interpret the original intent differently so that it better integrates into their own view of the world.
Sometimes the strategy is intentionally twisted to support personal agendas.In a typical organization, by the time strategy has moved to the implementers, half of its original intent is lost – and often times much more.
3. Strategy That Disregards Culture
One of Peter Druker’s most famous quotes is “Culture eats strategy for breakfast”. We all know it, but for some reason when we lay out our strategic plans, we totally ignore it.
Culture is the most powerful force in most companies.It can help you succeed, or it can help you fail. Ignore at your own risk.
It never ceases to amaze me that executives believe their organizations will do exactly what they say. The reality is that only about 20% of the management team will sign up for a new initiative with any enthusiasm – everybody else has to be convinced.
It takes much more effort to get 80% of the organization behind a major change than most believe. And the other 20%? They will NEVER get behind it.
5. Lack of Strategy Management Process
Companies have all kinds of processes to deliver products and service to their customers, develop new products, hire and manage people, and many more.
They spend hundreds of thousands of dollars (if not millions) to document and improve their processes. But what about the process to manage strategy execution?
Most companies have a more robust process to order post-it notes than they do to manage their strategies.
The bottom line:
Strategy doesn’t just happen. You have to work at it, and work at it really hard. The difficult work isn’t coming up with the strategy. The hard part is getting the organization to buy in and actively support it. Without a well-defined and managed strategy to execution process, this is almost impossible.